Question: According to rational expectations theory, systematic and predictable expansionary monetary and fiscal policies used to reduce unemployment are and . a. useful; can permanently reduce

According to rational expectations theory, systematic and predictable expansionary monetary and fiscal policies used to reduce unemployment are and .

a. useful; can permanently reduce both unemployment and inflation

b. useless; in fact are harmful because the only result is inflation

c. useful; can permanently reduce unemployment at the cost of slightly higher inflation

d. useless; have no impact on either unemployment or inflation

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